news release
Nottingham, 22 December 2011 – The latest Insolvency Index from Experian®, the global information services company, reveals a widening North versus South business failure divide, with southern firms faring far better than their northern counterparts. London and the South East of England saw insolvency rates[1] decrease between October and November, while company failures increased in the North East, North West and Yorkshire.
During November, insolvency rates were highest in the North West (0.14 per cent), North East (0.12 per cent) and Yorkshire (0.11 per cent). By comparison, the South East, South West and Greater London recorded failure rates of 0.07 per cent, 0.08 per cent and 0.08 per cent respectively.
Across the country, there was a small month-on-month improvement in the rate of business insolvencies, from 0.10 per cent in October to 0.09 per cent in November. Out of the UK’s business population, this represents 1,736 firms failing in November. In November 2010, the insolvency rate 0.07 per cent.
The average financial strength[2] of businesses in the UK deteriorated by 0.5 per cent in November, falling to 78.07 from 78.44 in October. In November 2010, the average financial strength score was 81.31.
Max Firth, Managing Director for Experian’s Business Information Services division in the UK & Ireland, said: “The latest insolvency index highlights that some businesses continue to need to assess the risk strategies they have in place very carefully. They need first to understand the risks they are exposed to and then protect themselves from debt that could be detrimental to their business on a regular ongoing basis.”
The UK’s biggest sectors
Of the five biggest industry sectors – business services, building/construction, property, IT and leisure/hotels – property was the only one that saw its improving insolvency rate improve - from 0.07 per cent in November 2010 to 0.06 per cent November 2011. It was also the sector to see the biggest improvement from October when the rate was 0.08 per cent.
SMEs
Although smaller businesses (with 3 to 10 employees) have generally managed to maintain lower rates of insolvencies over the past year, they experienced the biggest deterioration in financial strength between November 2010 (an average of 81.80) and November 2011 (an average of 81.04).
Region |
Insolvencies |
% change from |
% of business population failing |
% of business population failing |
Financial Strength Score |
Financial Strength Score |
Scotland |
81 |
-6.9 |
0.07% |
0.07% |
79.26 |
81.16 |
North East |
49 |
16.7 |
0.12% |
0.10% |
79.19 |
81.52 |
North West |
265 |
61.6 |
0.14% |
0.09% |
77.57 |
80.75 |
Yorkshire |
134 |
7.2 |
0.11% |
0.10% |
78.25 |
81.32 |
Wales |
62 |
40.9 |
0.11% |
0.08% |
78.46 |
80.92 |
West Midlands |
157 |
28.7 |
0.10% |
0.08% |
77.59 |
80.44 |
East Midlands |
100 |
12.4 |
0.09% |
0.08% |
79.01 |
81.67 |
Eastern |
166 |
46.9 |
0.09% |
0.06% |
79.22 |
82.18 |
South West |
121 |
26.0 |
0.08% |
0.06% |
80.52 |
82.96 |
Greater London |
371 |
15.2 |
0.08% |
0.06% |
75.57 |
80.17 |
South East |
230 |
25.0 |
0.07% |
0.06% |
79.45 |
82.47 |
Grand Total |
1,736 |
25.1 |
0.09% |
0.07% |
78.07 |
81.31 |
Source: pH, an Experian company
Number of employees |
Insolvencies |
% change from |
% of business population failing |
% of business population failing |
Financial Strength Score |
Financial Strength Score |
1-2 |
232 |
20.2 |
0.05% |
0.04% |
82.07 |
82.56 |
3-5 |
276 |
29.6 |
0.12% |
0.10% |
81.05 |
81.92 |
6-10 |
224 |
6.2 |
0.17% |
0.16% |
81.03 |
81.67 |
11-25 |
251 |
28.1 |
0.24% |
0.19% |
81.08 |
81.42 |
26-50 |
83 |
6.4 |
0.17% |
0.16% |
81.07 |
81.48 |
51-100 |
46 |
35.3 |
0.17% |
0.12% |
81.19 |
81.49 |
101-500 |
40 |
37.9 |
0.15% |
0.11% |
82.23 |
82.67 |
501+ |
11 |
22.2 |
0.12% |
0.10% |
85.70 |
85.23 |
Grand Total |
1,736 |
25.1 |
0.09% |
0.07% |
78.07 |
81.31 |
Source: pH, an Experian company
Sector |
Insolvencies |
% change from |
% of business population failing |
% of business population failing |
Financial Strength Score |
Financial Strength Score |
Extractive Industries |
- |
-100.0 |
0.00% |
0.07% |
80.09 |
82.86 |
Oil |
2 |
0.0 |
0.07% |
0.07% |
83.43 |
85.97 |
Building & Construction |
261 |
15.0 |
0.16% |
0.13% |
75.87 |
77.78 |
Building Materials |
2 |
-50.0 |
0.05% |
0.11% |
78.21 |
80.13 |
Chemicals Industry |
4 |
0.0 |
0.15% |
0.15% |
80.03 |
81.89 |
Diversified Industrials |
42 |
35.5 |
0.20% |
0.14% |
76.63 |
78.19 |
Electricals |
13 |
8.3 |
0.14% |
0.13% |
78.27 |
79.57 |
Engineering |
44 |
-6.4 |
0.11% |
0.12% |
78.44 |
79.66 |
Printing, Paper & Packaging |
5 |
- |
0.15% |
0.00% |
78.07 |
79.06 |
Textiles & Clothing |
20 |
17.6 |
0.14% |
0.12% |
74.64 |
76.76 |
Breweries |
- |
- |
0.00% |
0.00% |
75.67 |
79.67 |
Spirits, Wine & Tobacco |
- |
- |
0.00% |
0.00% |
78.40 |
83.09 |
Food Manufacturing |
8 |
33.3 |
0.12% |
0.09% |
76.46 |
78.26 |
Pharmaceuticals |
1 |
- |
0.08% |
0.00% |
81.61 |
82.31 |
Wholesaling |
77 |
22.2 |
0.13% |
0.10% |
78.15 |
80.05 |
Leisure & Hotels |
144 |
27.4 |
0.16% |
0.13% |
76.96 |
79.68 |
Media |
42 |
-8.7 |
0.07% |
0.07% |
78.35 |
80.82 |
Food Retailing |
20 |
17.6 |
0.12% |
0.11% |
73.16 |
75.78 |
Non-Food Retailing |
95 |
37.7 |
0.11% |
0.08% |
76.63 |
79.05 |
Servicing / Repair |
8 |
166.7 |
0.11% |
0.04% |
80.81 |
82.62 |
Transport |
49 |
-9.3 |
0.09% |
0.10% |
76.92 |
78.74 |
Utilities |
1 |
-50.0 |
0.04% |
0.09% |
75.51 |
79.83 |
Postal & Telecommunications |
11 |
37.5 |
0.13% |
0.09% |
73.52 |
76.55 |
Agriculture, Forestry & Fishing |
12 |
300.0 |
0.06% |
0.01% |
83.42 |
85.28 |
Banking & Financial Services |
65 |
51.2 |
0.13% |
0.08% |
81.93 |
84.17 |
Health & Household |
- |
- |
0.00% |
0.00% |
77.41 |
79.04 |
Business Services |
444 |
40.1 |
0.08% |
0.06% |
77.69 |
81.80 |
Hiring & Leasing |
23 |
35.3 |
0.17% |
0.12% |
80.35 |
81.83 |
Property |
90 |
-13.5 |
0.06% |
0.07% |
80.17 |
82.46 |
Other Services |
98 |
40.0 |
0.04% |
0.03% |
83.21 |
86.14 |
Plastics & Rubber |
11 |
0.0 |
0.17% |
0.16% |
77.25 |
78.26 |
Insurance |
6 |
0.0 |
0.05% |
0.05% |
82.64 |
84.39 |
IT |
66 |
53.5 |
0.06% |
0.04% |
80.14 |
83.75 |
Motor Traders |
50 |
56.3 |
0.14% |
0.09% |
78.66 |
80.39 |
Grand total |
1,736 |
25.1 |
0.09% |
0.07% |
78.07 |
81.31 |
Source: pH, an Experian company
Follow us on Twitter @Experian_UK for our latest news, views and insight.
Ms Serj Heera
PR Manager
0115 992 2773/07837 652169
About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 80 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2011 was US$4.2 billion. Experian employs approximately 15,000 people in 41 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com
[1] The insolvency rate is calculated by comparing the number of businesses that failed with the total business population in Great Britain.
[2] The financial strength score predicts the likelihood of a business failing in the next 12 months, with 100 being the least likely to default and 1 being the most likely.